Image: Nissan Cube
Nissan
Nissan is testing a new electric motor powered by lithium-ion batteries in this boxy small car called the Cube.
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updated 9/19/2008 3:07:16 PM ET 2008-09-19T19:07:16

Nissan is testing a new electric motor powered by lithium-ion batteries in this boxy small car called the Cube.

Hybrids are yesterday's news by Nissan's standards.

Although the Japanese automaker does plan to embrace hybrid technology, it's banking on plug-in electric vehicles as the next big thing.

Nissan recently announced it will introduce an affordable, all-electric vehicle by 2010 that will roll out globally by 2012. Its success depends largely on battery technology still under development, as well as convincing consumers that most of their daily driving needs can be met by small electric vehicles that can't drive as far or as fast as gas-powered cars.

"It is a risky move for them. On a scale of one to 10, I'd say it's an eight," says Art Spinella, president of CNW Marketing Research in Bandon, Ore.

Nissan's current lack of hybrid models — it has but one, the Altima Hybrid, sold in only eight states — has put the company behind other automakers in the race to develop alternative-fuel technology. But if its gamble pays off, the company could leapfrog its competitors.

"It really is a good time to do it," Spinella says. "It's high on consumer interest lists. Now how long it lasts, I don't know."

Nissan will make hybrid versions of existing cars rather than design a model specifically as a hybrid only, as Toyota has done with its Prius and as Honda will do with its recently announced Insight. That decision allows Nissan to put more effort into developing electric vehicles.

"The goal of the electric vehicle is to allow people who drive to work, the vast majority of people who drive to work, to get there and back on one charge," says Darryll Harrison, a Nissan spokesperson. "We're definitely confident that the EV you'll see in 2010 will be an EV that will allow you to do that."

Nissan did not disclose how far it expects the new electric vehicle will go on a single charge. Chevrolet is aiming for a 40-mile electric-only range for its Volt plug-in hybrid. But the Volt will have a small combustion engine on board that will act as a generator to replenish the batteries and extend the driving range.

Other major carmakers are rushing to get alternative-fuel vehicles on the road as well. Ford, Fuji (which owns Subaru), Mitsubishi and Toyota have all begun work on battery-powered and next-generation hybrid vehicles.

"The holy grail continues to be the battery technology," said John Viera, Ford's sustainable business strategies director at a recent sustainability forum in New York. "That's the thing that is making electric vehicles cost-prohibitive."

Even so, Ford sees battery technology as taking precedence over hydrogen for mass-produced alternative-fuel vehicles, Viera said.

To give the press and the public a preview at its plans, Nissan unveiled two concept cars last month in Tokyo: one powered only by electricity, another powered with hybrid technology. Both use advanced lithium-ion batteries produced by Nissan and NEC Corp. under their joint venture, Automotive Energy Supply Corporation.

The batteries are more reliable, safer and less expensive than conventional nickel metal-hydride batteries, Nissan says. They also provide twice the power and take up less space than conventional batteries.

"With the change in fuel prices, my thought is that there is a paradigm shift going on," he says. "Americans are certainly opening up to alternatives if it means a cleaner environment and ultimately saving some money on gas."

As with any new technology, the initial cost and complexity of electric vehicles remain a concern for many in the industry.

While consumers definitely show interest in electric vehicles, the cost and maintenance of electric vehicles could put off potential buyers, CNW's Spinella says.

The batteries alone in some alternative-fuel vehicles like the Chevrolet Volt, a next-generation plug-in hybrid, are reportedly estimated to cost upwards of $10,000. Leasing the batteries, as Norway-based Think Global does with its electric vehicles, is one way electric-car makers try to keep costs down.

"That's going to be the issue," Spinella says. "Do you want to add another $100 or $200 a month to rent these batteries?"

To see Nissan’s electric vehicle plans, click on the “slide show” link above.

© 2008 ForbesAutos.com

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